A few weeks ago, Peter Rive, the Co-Founder and Chief Technology Officer of SolarCity, posted a blog entitled “Put Battery Storage in the Hands of Grid Operators”. In his post, Mr. Rive argues that while battery storage for residential, commercial, and utility-scale customers is one of the most anticipated developments in the energy space and might allow consumers to “cut the cord” on their relationships with utilities, that would be a bad idea. Mr. Rive suggests that grid operators, not electricity consumers, are best positioned to optimize the use of storage technology:

Grid operators are best-positioned to direct battery storage to discharge clean energy at optimal moments—for example when demand is at its highest, and when grid infrastructure is most under strain. Without this storage capacity, solar penetration in excess of 60% of mid-day peak could become problematic for the grid, as utilities have to contend with an abundance of power which can cause voltage and power balance issues.

However, with storage in the hands of grid operators and utilities, this problem becomes an immensely powerful solution. In this scenario, grid operators are suddenly empowered to store and discharge solar energy where and when it's needed most, smoothing out peaks and ramps, while powering more of the total grid consumption with clean and renewable sources. Additionally, utilizing storage to unlock massive benefits in the areas of frequency and voltage support can further lower grid costs. Many of these capabilities are available now through distributed resources, even without storage, and we should work together to put them into the hands of utilities for the benefit of the ratepayers.

First, let me be clear: I completely agree with Mr. Rive. On an optimized power grid, the grid operator would control the storage resource for all the reasons that Mr. Rive suggests. An optimized storage resource would be deployed on distribution systems proximate to the customer in order to maximize the value and flexibility of the resource. But its dispatch would remain under the control of a central entity that could optimize its use on, and minimize its cost to, the grid.

The surprise for me in reading Mr. Rive’s post was not its argument but its source. For while Mr. Rive makes a valid point about the optimal use of storage on the grid, one could, of course, make that same point about generation.

It is near axiomatic that electricity generation is done most efficiently at scale. For example, it is far cheaper and more efficient for a grid operator to deploy 100,000 solar PV panels in a field than it is for 100,000 commercial and residential customers to put a solar panel on their rooftops. If the deployment of solar PV electricity was driven entirely by considerations of system cost and optimization, SolarCity and its competitors would not exist (at least not in their current form).

The market for rooftop solar PV exists for three reasons:

1. There are a number of electricity customers that wish to do their part to improve the environment by deploying rooftop solar PV systems, and they are willing to pay a premium to do so.

2. There are a number of electricity customers that value the increased reliability that comes from supplementing their supply of electricity with self-generated solar PV, and they are willing to pay a premium to do so.

3. How society allocates the huge incumbent costs of the electricity grid across all electricity customers is entirely a political question. The kind of customers that are inclined to deploy solar PV on their rooftops, together with the business interests that service them, comprise a powerful political block. That block has the power to ensure that incumbent grid costs are allocated to the owners of rooftop solar PV systems in such a way as to reduce or eliminate the premium that the owners would otherwise have to pay.

My point is not that this is right or wrong. My point is simply that this is what is. What concerns me about Mr. Rive’s post is its implicit assumption that the factors that have driven adoption of rooftop PV solar systems apply only to rooftop solar PV systems and not to other customer-owned technologies that promote clean, reliable power, such as behind the meter storage.

How the grid will evolve over the coming decades is a fascinating question about which we can only speculate as to the answers. One hopes that its evolution will be driven as much as possible by the goals of efficiency and optimization. But one knows that its evolution will be driven by other factors as well.

I applaud Mr. Rive for his concern about the optimization of the grid. But there is no reason to believe that the same factors that have driven less than optimized deployments of customer-owned rooftop solar PV systems will not also drive of less than optimized deployments of behind the meter storage.

Jim Greenberger is the Executive Director of NAATBatt International, a trade association of companies, associations and research institutions working to commercialize advanced electrochemical energy storage technology for new, high-tech applications. NAATBatt International's core mission is to promote the commercial interests of its members by accelerating adoption of electrochemical energy ...

WOw, could you get it more wrong?
Sure ISO's can have access to my batteries as long as they pay me peak/spinning reserve/ frequency and voltage stabilization rates, if I produce energy or not. That's the going price for those services on the grid. Bet they don't want to.
Nuclear and coal have to PAY people to take their electricity if there is note enough demand because they can't throttle.
Would you all please figure that out?
It is axiomatic that electrical generation is best done distributed, not central, not at scale. Lower grid loses and better stability. It is far more stable to have 100,000 rooftop solar panels inverters supplying the grid, than a few giant fields of solar panels.
If the question of system cost and optimization were taken into account, there would be no nuclear nor coal.
There is NO imbalance problem with 150% solar or 10,000 % solar to the grid. Solar does not cause problems, it's the old coal and nuclear base load plants that can't throttle that are the problem. If my local solar grid connect inverter detect high voltage and frequency, it just does not supply to the grid. No da,age, no imbalance.

Clayton, agreed the instantaneous output of grid-tied energy storage must be controlled in real-time via pricing or related signals based on grid needs. (Max, this sort of "control" need not prevent the owner from going off-grid whenever they saw fit).

But I think in this context, the more important part of "who controls the storage" is really "who has a financial stake in the storage and who negotiates pricing and market access on behalf of the owners".

The bottle-neck is that all of those would-be owners of home energy storage can't sell storage services to the grid until they can buy storage systems with controllers that can hook into their grid's control system. This is a part of the smart grid that doesn't exist yet, and neither regulated utilities nor industry committees are particularly fast at laying out the protocols and standards needed for new services.

Remember the state of EV fast charging. The industry committee, SAE has a standard for charger plugs (J1772, used on the Leaf and Volt), which is limited to 19 kWatts. This is fine for the Leaf and Volt, but it would take over 4 hours to charge a Tesla Model S. While the SAE debated an upgrade, Tesla made their own Super charger interface (with something like 100kW), put it on their cars, and deployed Superchargers all over the nation.

Unsurprisingly, as described in this article, Solar City has apparently already started shipping storage system which can be controlled by the Solar City network. This will let Solar City control the user-owned distributed storage (presumably at a profit), via the same market that is used to dispatch other electricity production assets.

The SAE committee might eventually catch up and replace the Supercharger interface with an industry standard, but why should distributed storage manufacturers bother with a committee standard to allow home system owners to sell directly to grid markets when they can follow the Solar City model, and profit directly from storage services provided by their customers?

19 kW? I would be happy to get 7.2 kW (240 VAC 30 A) delivered to my vehicle, Tesla or no. That's about 20 miles of range per hour on the charger. A typical commuter would be able to get a full recharge overnight and be ready for anything that came the next day. Only back-to-back long trips would require anything more, and a half-charge on a Supercharger with an overnight top-up at 7.2 kW would bring the car back to full by the next morning.

Should they CONTROL it, no. Should they have it so as to be able to use clean energy more efficiently, yes. However if a home owner/business decides to put it in when it becomes a reasonable economic option and cut the umbilical that should always be an option. No, control should not be given to utilities through legislation or regulations in any way!

I wonder how the Chairman of the Solar City board feels about this idea. Forward thinker that he is I would find it suprising that he would be supportive of the antiquated centrally planned model for managing distributed energy resources. After all he is rapidly building the largest distributed battery in the world - the fleet of Tesla vehicles.

Time and time again it is shown that replacing central planning with distributed response based upon price signals is the most efficient approach to managing complex, numerous individual entities. The best way to manage the millions of independent sources and loads is to have a market maker sending out bid and ask prices on a near real time basis and allow the sources and loads to meet demand optimally through that system.

Implimenting such a system will be challenging and take time. However, as with so many similar systems, the evolution can and should be managed by letting the large legacy organizations manage their own storage and let the distributed storage emerge evolutionarily.